http://kulturcritic.wordpress.com/posts/the-simulacran-republic-from-the-archives-of-joe-baegant/
“The Simulacran Republic”
A while back it was announced that a Japanese inventor had successfully created an invisibility cloak using a material made of thousands of tiny beads called “retro-reflectum.” I found this so amazing that I told six friends, three men and three women, about it over the next two days. Not a one of them found it even interesting, much less amazing. Two of the men subsequently showed mild interest when I pointed out that it could be used to mask tanks and soldiers in combat, and one speculated on its terrorist implications. Our techno hyper-reality has so gutted and rewired the brains of Americans that ordinary intelligent people are not even capable of amazement at such a thing as invisibility! To me, this is an indication of a near-total death of the individual mind and imagination caused by our over-technologized, effects glutted sensory environment.
The pure miracle of invisibility is uninteresting unless it can be linked to, say the rumbling terror of an armored tank — made perhaps even more attention-grabbing by squashing the bloody guts out of an Iraq under its tracks? It’s the sensory effect that matters, the simulacrum, not the reality. It’s the kind of thing about America that drives me to thoughts of emigration daily.
Americans, rich or poor, now live in a culture entirely perceived through, simulacra-media images and illusions. We live inside a self-referential media hologram of a nation that has not existed for quite some time now, especially in America’s heartland. Our national reality is held together by a pale, carbon imprint of the original. The well-off with their upscale consumer aesthetic, live inside gated Disneyesque communities with gleaming uninhabited front porches representing some bucolic notion of the Great American home and family. The working class, true to its sports culture aesthetic, is a spectator to politics … politics which are so entirely imagistic as to be holograms of a process, not a process. Social realism is a television commercial for America, a simulacran republic of eagles, church spires, brave young soldiers and heroic firefighters and “freedom of choice” within the hologram. America’s citizens have been reduced to Balkanized consumer units by the corporate state’s culture producing machinery.
We no longer have a country — just the hollow shell of one, a global corporation masquerading electronically and digitally as a nation called the United States. The corporation now animates us from within our very selves through management of the need hierarchy in goods and information. Sure there is flesh within the machine, but its animating force is a viral concept, a meme run amok. Free market capitalism. We got to move them refrigerators, got to sell them color teevees.
Meanwhile the culture generating industry spins our mythology like cotton candy. We all need it to survive, Hollywood myths, imperial myths, melting pot myths, the saluting dick male myths. They keep the machine running. And when the machine is running correctly, it smoothes its own way by terrifying uncooperative people into submission in prisons and torture rooms, where we do not have to look at the corpses on ice and the naked hooded bodies handcuffed to the bars. We are innocent as long as we keep our eyes taped shut. And only with our eyes shut can we keep seeing the hologram. And with duct tape over our mouths, we can recite its slogans with one hand over our heart with the other one resting on the trigger.
The average American spends about one third of his or her waking life watching television. The neurological implications of this are so profound that they cannot even be comprehended in words, much less described by them. Television creates our reality, regulates our national perceptions and our interior hallucinations of who we Americans are (the best and only important tribe on the planet.) It schedules our cultural illusions of choice, displays pre-selected candidates in our elections, or types of consumer goods. It regulates holiday marketing opportunities and the national neurological seasons, which are now governed by the electrons of the illusion. We live within a media generated belief system that functions as the operating instructions for society. Anything outside of its parameters represents fear and psychological freefall to the faceless legions of within it.
Our civilization, our culture, in as much as it can be said to exist in any cohesive way, is based upon two things, television and petroleum. Whether you are a custodian or the President, your world depends upon an unbroken supply of both. So it is small wonder that we all watch a televised global war for oil. As in all produced illusions, everyone we see is an actor. There are the television actors portraying what passes for reality, and real people performing for television. Non-actors in Congress perform in front of the cameras, grappling over the feeding tube on Terri Schiavo; real actors portray non-actors in “reality shows.” Michael Jackson shows up for court in pajamas and Jeff Weise shows up for class with a gun. The demand for “newsmakers” is relentless as the empire’s corporate cultural machinery weaves the warp of consumer illusions that make up our notion of individualism, and the weft of democratic mythology that constitutes our political system. This is by no means a free country and given the intense luminosity of the hologram, we cannot even see freedom from here, and probably would not recognize it if we could. Moreover though, we cannot tear our eyes away from the great flickering glow of the hologram.
As my late friend Timothy Leary put it, “An enormous industry, similar to the national projects of pyramid-building in Egypt, cathedral-building in medieval Europe, and prison-camp building in Stalinist Russia has emerged in America — the production of political martyrs, fallen heroes and concept outlaws. … The essence of ‘news’ is, of course, the modern version of Roman coliseum shows and gladiator combats.” And like clockwork, there is the nightly ritual bloodletting through televised wars and domestic murders, with detective Lenny Briscoe finding the corpses at seven, eight and eleven PM weekdays.
The hologram that is our cathedral of consciousness and our national mind is an ever-darkening one. The average American, if he even thinks about the mind, thinks of it in the obsolete “mind-contained-in-the-brain” way. A few intellectuals and a handful of old dopers like me understand that reality is consensus based and is an interconnected network consisting of many minds operating along a theme. And the theme seems to be pathological.
America suffers from a psychosis, a psychosis being nothing more than an insistence upon staying in an untenable state of consciousness, despite the normal modeling of those around you. This is not out of meanness, but rather an indifference so profound as to be a sickness. The hologram IS the psychosis made manifest. Psychotics love to play ominous games with those around them, just as America does with the world today.
It always comes down to the one thing we never study in school, the one thing we cannot learn about in this country without a great deal of personal extracurricular effort — consciousness. As we have known at least since the Sixties, the core issue of our existence is consciousness, which our corporate state is compelled to control at all times. That’s why drugs are illegal; that’s why we have hundreds of television channels; and that’s why you will never find anything much resembling the truth in U.S. newspapers and magazines. But there are still those of us who remember our consciousness experiments in the Sixties. Remember what it is like to peer into other realities, not to mention observe the inherent folly and frequent horror of our own war-profit-driven, animal murdering, death-and-sex-without-love obsessed culture. There are those of us who know that when a thrush cries out from the branch it echoes throughout the galaxy. All things are connected and ownership of things is meaningless. The purpose of life is to know this. Lao-tsu knew it, just like Einstein knew it. But you and I are not allowed to. It would shatter our revered hologram, the one that threatens to shatter the world.
To even begin to dissolve this dangerous hologram we would have to examine the biggest lie of all — that technology is neutral and that people determine its ultimate effects. What divine horseshit! Consider what even the best use of nuclear energy leaves in its wake over the long haul an uninhabitable planet. No matter who is in charge we end up with millions of tons of waste with a half-life in the tens of thousands of years. But the hologram we revere asks us to judge the technology at its heart in strictly personal terms — cars, vacuum cleaners, and digital amusements. Pay no mind to the toxic rivers and a sky turning red. Science and technology are our religion and all philosophical decisions are made in the corporate world whose function is to sell commodities. Easily the most terrifying aspect of the industrial/media/political hologram is that we are trapped. There is no way out of a technological industrial machine where you need at least a car, a phone, etc. to function, to participate at all.
Thanks to the hologram, American culture, as such, is nearly over. It is not sustainable. It is not reformable. Not only are TV and all digital media unreformable, but they are sure to accelerate our demise more rapidly because of the technological capitalist paradigm of growth at all cost. We cannot eliminate the generators of the hologram, television and electronic media. They are the glue of the hologram, the mediators of our human experience. We will all die without them, now that they have replaced all other previous forms of knowledge, the ancient forms, and have colonized our inner lives like a virus. The natural world is not only boring but does not even exist, as we sit mesmerized, while the hologram sells our very feelings back to us. Are we adequate? How are we supposed to act? Did you phone someone you love today? What and whom are we to fear? You are rendered numb by a hypnotic medium, react to your own feelings which have been stolen and doled back out to you, and pay money to do so. Brilliant! The commodification of human consciousness is probably the most astounding, if ghoulish, accomplishment of American Capitalist culture.
Meanwhile, there is the omniscient “one voice that speaks out to the many,” the disembodied military/corporate voice, that all but guarantees an authoritarian political scenario. Unlike the humans who constitute their living innards, the corporations animating the hologram are themselves deathless. The citizens cannot harm them. Under U.S. law corporations have all the rights and protections of individuals, and they cannot be regulated because corporations are “fictional persons” and have the same right to free speech as persons. Of course, given that the media are corporations, their speech is a helluva lot more impactful and significant than any one person’s. “But,” as the brilliant author of In the Absence of the Sacred, Gerry Mander puts it: “They have none of the commensurate responsibilities. Communities cannot control them because they can always move to other communities. They do not have corporeality; they can’t be executed. You can imprison certain people within a corporation if they engage in criminal acts. The corporation itself, however, lives beyond the people in it.”
The light of the hologram plays on material reality and remakes it in its own image, destroying all connection with the natural world. Malls and suburbs and hyper-real surfaces and speed — meaningless but dazzling technology. The earth gets a makeover in the image of Disneyland and becomes inhabited by humans who are commodified versions of themselves.
It is difficult for people to grasp that we are in an age of corporate dominion just as we were once in an age of domination by royal families, kings and warlords. Somehow it is hard to equate our tribute rendered to the credit card companies, the insurance companies, the IRS, the power cartels, the mortgage banks, with the kind of bondage it is. Yet we must do these things to be allowed to live in society. The only other choice is to sleep under a bridge. And these days, whether due to an on-setting depression or creeping wisdom, I often contemplate just that. I really do. Of course I understand that even under a bridge one cannot escape the hologram’s blue flicker issuing from a hundred million encroaching suburban windows. But like I said, there are still a few of us old bastards out here who remember. And we can still hear the cry of the thrush echoing, still out there shattering galaxies. Freedom is possible.
Monday, December 1, 2014
Saturday, November 15, 2014
SC124-11
http://kulturcritic.wordpress.com/posts/chasing-the-west-caught-in-the-spiders-web/
Chasing the West: Caught In the Spider’s Web!
These are interesting times. Are they not? The world continues on its collision course with both human history and geologic destiny, while the “only indispensable country” debates with itself how to “flush” the remainder of humanity for which it no longer has any need.
Ever since the height of Stalinism, the peoples of Russia and the greater Soviet Union have emulated and looked longingly, hungrily to the West: Western fashions, music, entertainment, ‘freedoms,’ ‘opportunities’ and all the rest. As soon as the Iron Curtain came tumbling down, those people and their leaders were scrambling to line up for the comforts and extravagances of the Western lifestyle, the spectacular lifestyle of the rich and famous. And to some extent they have modeled that life, and assumed those styles, at least in appearance, rather well. After all, it is only the spectacle that is important.
Even deep in the heart of the Siberian outback, along the foothills of the Altai Mountains, Russians buy the most fashionable Western accoutrements and wardrobes, emulate European cosmetic surgical procedures, eat Western fast food in their capitols, buy the biggest American SUVs, flaunt their new Apple iPhones, take out big mortgages and loans from banks for their new acquisitions, and dig deeper into debt for their travel visas and European excursions. All the while they ignore the reality of this race to the bottom; not only the changes to their profound cultural heritage, but as well to the unsustainability of this new direction itself, its unquenchable thirst for more acquisitions and greater debt financing.
Round 2 (Repeat)
This rush to the West, economically, socially, financially, culturally has put them exactly where the USA hegemony wants them… stuck securely in the spider’s web it’s woven. When Russia should have been pivoting to the East, they made the mistake of going West with the rest of the young men! When they should have been embracing China and their own rich prehistories, instead they looked to the superficiality and frivolousness of their rich and evil Uncle Sam. It was a sting operation set by the US hegemony, intentionally or not. And Russia fell for it, hook, line, and sinker. They should have paid more attention to Paul Newman and Robert Redford, and less attention to ‘Tricky Dick’ Nixon in 1973. If they had, they would have been cognizant of the trap being set even back then… blue jeans, big tits, and blanket propaganda.
Well, now the spider has the victim stuck securely in the web, and he has turned around to savor the treat. The Russian ruble continues to plunge against the US dollar, while the appetite of Siberians to keep spending just continues apace. Russia is stuck in this sticky web with oil prices collapsing, sanctions pressing, and patience dwindling, as the lukewarm war in Ukraine continues to enrage the Russian populous, and foment their growing disdain for Obama.
And while Putin and Co. are now looking due East, it may be a bit too little too late to avoid a major collapse, as the deranged monster of the Beltway continues to drool and wet its pants publicly savoring its expected spoils. But, the Russian soul is strong, hardened by Mongol, Swedish, French, and German invasions, not to mention the resiliency in fighting off the ghost of Uncle Joe Stalin. So, Putin and Co. may yet have a trick or two up its sleeve to help right this ship and annul the effects of the latest, American, invasion. The USA for its part needs to seriously reassess its role in the world and quietly remove itself to some quiet contemplation in the corner of its room, instead of continuously acting-out like the red-haired step-child it has become. We should all be sick to death that our country keeps enforcing policies of global death and domination in our name and with our monies. After all, we civilized folk long ago declared a war of domination on nature, and look where that’s got us.
Chasing the West: Caught In the Spider’s Web!
These are interesting times. Are they not? The world continues on its collision course with both human history and geologic destiny, while the “only indispensable country” debates with itself how to “flush” the remainder of humanity for which it no longer has any need.
Ever since the height of Stalinism, the peoples of Russia and the greater Soviet Union have emulated and looked longingly, hungrily to the West: Western fashions, music, entertainment, ‘freedoms,’ ‘opportunities’ and all the rest. As soon as the Iron Curtain came tumbling down, those people and their leaders were scrambling to line up for the comforts and extravagances of the Western lifestyle, the spectacular lifestyle of the rich and famous. And to some extent they have modeled that life, and assumed those styles, at least in appearance, rather well. After all, it is only the spectacle that is important.
Even deep in the heart of the Siberian outback, along the foothills of the Altai Mountains, Russians buy the most fashionable Western accoutrements and wardrobes, emulate European cosmetic surgical procedures, eat Western fast food in their capitols, buy the biggest American SUVs, flaunt their new Apple iPhones, take out big mortgages and loans from banks for their new acquisitions, and dig deeper into debt for their travel visas and European excursions. All the while they ignore the reality of this race to the bottom; not only the changes to their profound cultural heritage, but as well to the unsustainability of this new direction itself, its unquenchable thirst for more acquisitions and greater debt financing.
Round 2 (Repeat)
This rush to the West, economically, socially, financially, culturally has put them exactly where the USA hegemony wants them… stuck securely in the spider’s web it’s woven. When Russia should have been pivoting to the East, they made the mistake of going West with the rest of the young men! When they should have been embracing China and their own rich prehistories, instead they looked to the superficiality and frivolousness of their rich and evil Uncle Sam. It was a sting operation set by the US hegemony, intentionally or not. And Russia fell for it, hook, line, and sinker. They should have paid more attention to Paul Newman and Robert Redford, and less attention to ‘Tricky Dick’ Nixon in 1973. If they had, they would have been cognizant of the trap being set even back then… blue jeans, big tits, and blanket propaganda.
Well, now the spider has the victim stuck securely in the web, and he has turned around to savor the treat. The Russian ruble continues to plunge against the US dollar, while the appetite of Siberians to keep spending just continues apace. Russia is stuck in this sticky web with oil prices collapsing, sanctions pressing, and patience dwindling, as the lukewarm war in Ukraine continues to enrage the Russian populous, and foment their growing disdain for Obama.
And while Putin and Co. are now looking due East, it may be a bit too little too late to avoid a major collapse, as the deranged monster of the Beltway continues to drool and wet its pants publicly savoring its expected spoils. But, the Russian soul is strong, hardened by Mongol, Swedish, French, and German invasions, not to mention the resiliency in fighting off the ghost of Uncle Joe Stalin. So, Putin and Co. may yet have a trick or two up its sleeve to help right this ship and annul the effects of the latest, American, invasion. The USA for its part needs to seriously reassess its role in the world and quietly remove itself to some quiet contemplation in the corner of its room, instead of continuously acting-out like the red-haired step-child it has become. We should all be sick to death that our country keeps enforcing policies of global death and domination in our name and with our monies. After all, we civilized folk long ago declared a war of domination on nature, and look where that’s got us.
Tuesday, November 11, 2014
SC124-10
http://peakoil.com/generalideas/if-everything-is-just-fine-why-are-so-many-really-smart-people-forecasting-economic-disaster
If Everything Is Just Fine, Why Are So Many Really Smart People Forecasting Economic Disaster?
The parallels between the false prosperity of 2007 and the false prosperity of 2014 are rather striking. If we go back and look at the numbers in the fall of 2007, we find that the Dow set an all-time high in October, margin debt on Wall Street had spiked to record levels, the unemployment rate was below 5 percent and Americans were getting ready to spend a record amount of money that Christmas season. But then the very next year the worst economic crisis since the Great Depression shook the entire planet and everyone wondered why most people never saw it coming. Well, now a similar pattern is unfolding right before our eyes. The Dow and the S&P 500 both hit record highs on Monday, margin debt on Wall Street is hovering near record levels, the unemployment rate has ticked down a little bit and Americans are getting ready to spend more than 600 billion dollars this Christmas season. The truth is that the economy seems pretty stable for the moment, and most people cannot even imagine that an economic collapse is coming. So why are so many really smart people forecasting economic disaster in the near future?
For example, just consider what the Jerome Levy Forecasting Center is saying. This is an organization with a tremendous economic forecasting record that goes all the way back to the Great Depression. In fact, it predicted ahead of time the financial trouble and the recession that would happen in 2008. Well, now this company is forecasting that there is a 65 percent chance that there will be a global recession by the end of next year…
In 1929, a businessman and economist by the name of Jerome Levy didn’t like what he saw in his analysis of corporate profits. He sold his stocks before the October crash.
Almost eight decades later, the consultancy company that bears his name declared “the next recession will be caused by the deflating housing bubble.” By February 2007, it predicted problems in the subprime-mortgage market would spread “to virtually all financial markets.” In October 2007, it saw imminent recession — the slump began two months later.
The Jerome Levy Forecasting Center, based in Mount Kisco, New York, and run by Jerome’s grandson David, is again more worried than its peers. Its half-dozen analysts attach a 65 percent probability of a worldwide recession forcing a contraction in the U.S. by the end of next year.
Could they be wrong?
It’s certainly possible.
But I wouldn’t bet against them.
John Hussman is another expert that is warning of financial disaster on the horizon. He believes that we are experiencing a massive stock market bubble right now and that stocks are approximately double the value that they should be…
If you look at corporate profits and especially corporate profit margins, they’re one of the most cyclical and mean-reverting series in economics. Right now, we have corporate profits that are close to about 11% of GDP, but if you look at that series you will find that corporate profits as a share of GDP have always dropped back to about 5.5% or below in every single economic cycle including recent decades, including not only the financial crisis but 2002 and every other economic cycle we have been in.
Right now stocks as a multiple of last year’s expected earnings may look only modestly over valued or modestly richly valued. Really if you look at the measures of valuation that are most correlated to the returns that stocks deliver over time say over seven years or over the next 10 years the S&P 500 in our estimation is about double the level of valuation that would give investors a normal rate of return.
Could you imagine the chaos that would ensue if stocks really did drop by 50 percent?
Well, Hussman says that this is precisely what must happen in order for stock prices to return to historical norms…
Right now, like I say, we are looking at stocks that have been pressed to long-term expected returns that are really dismal. But more important than that, in every market cycle that we’ve seen with the mild exception of 2002, we’ve seen stocks price revert back to normal rates of return. In order to get to that point from here, we would have to have equities dropby about half.
If that does happen, it will make the crisis of 2008 look like a Sunday picnic.
Meanwhile, other very prominent thinkers are also warning that an economic nightmare is rapidly approaching.
Economic cycle theorist Martin Armstrong foresees major economic problems in 2015 which will ultimately lead to “civil unrest” in 2016…
It looks more and more like a serious political uprising will erupt by 2016 once the economy turns down. That is the magic ingredient. Turn the economy down and you get civil unrest and revolution.
And of course there are a whole lot of other economic cycle theorists that are forecasting that we are about to experience a massive economic downturn as well. For much more on this, please see this article andthis article.
What is truly frightening is that we have never even come close to recovering from the last economic crisis. One poll that was taken just prior to the recent election found that only 28 percent of Americans said that their families were doing better financially. In addition, here are some more survey numbers about how Americans are feeling about the economy…
According to voter exit polls conducted by CNN, 78% said they are worried about the economy, with 69% saying that, in their view, economic conditions are not good. 65% responded that the country is on the wrong track vs. only 31% who believed that it is headed in the right direction.
Even though we are repeating so many of the same patterns that we experienced back in 2007, we are doing so with a fundamentally weaker economy. The last crisis did a tremendous amount of permanent damage to us. For an extensive look at this, please see my previous article entitled “12 Charts That Show The Permanent Damage That Has Been Done To The U.S. Economy“.
And there are lots of signs that much of the planet is already entering another major economic slowdown. In a recent article, Brandon Smith summarized some of these. He says that we are currently witnessing “the last gasp of the global economy“…
Global exports, and thus consumer demand, are plunging. Germany, the only pillar left to prop up the failing European Union, has experienced a severe decline in exports not seen since 2009.
China, the largest exporter and importer in the world, and Chinese companies, have been caught in a number of instances using fraudulent invoices to artificially inflate their own export numbers, in some cases reporting 50% more exported goods than had actually existed.
China’s manufacturing has also declined for the past five months, exposing the nature of its inflated export stats and indicating a global slowdown.
The Baltic Dry Index, a measure of global shipping rates for raw goods, and thus a measure of demand for shipping, continues to drag along near historic lows.
The U.S. consumer (the only economic asset the U.S. has besides the dollar’s world reserve status), has seen declines in spending as well as wages.
In the meantime, long term jobless Americans continue to fall off welfare rolls by the millions, making unemployment numbers look good, but the overall future picture look terrible as participation rates dissolve into the ether of government statistics.
How is such poverty being hidden? Foodstamps. Plain and simple. Nearly 50 million Americans now subsist on food stamp programs today, and this number shows no signs of dropping. In states like Illinois, two people sign up for food assistance for every citizen that happens to find a job.
From time to time, I get accused of “spreading fear” and of being obsessed with “doom and gloom”.
But that is not the case at all.
I actually want our economy to stay stable for as long as possible. Many Americans don’t realize this, but even the poorest of us live in luxury compared to much of the rest of the world. It would be wonderful if we could all live out our lives in peace and quiet and safety.
Unfortunately, it is simply not going to happen.
And it does not take an expert to see what is coming.
Anyone with half a brain should be able to see the economic disaster that is approaching.
There is hope in understanding what is happening and there is hope in getting prepared. Millions of Americans that are willingly blind to our problems are going to have their lives absolutely destroyed when they get blindsided by the coming crisis. So please use this brief period of relative stability to get prepared and to warn others.
Once this false bubble of hope runs out, all of our lives are going to dramatically change.
If Everything Is Just Fine, Why Are So Many Really Smart People Forecasting Economic Disaster?
The parallels between the false prosperity of 2007 and the false prosperity of 2014 are rather striking. If we go back and look at the numbers in the fall of 2007, we find that the Dow set an all-time high in October, margin debt on Wall Street had spiked to record levels, the unemployment rate was below 5 percent and Americans were getting ready to spend a record amount of money that Christmas season. But then the very next year the worst economic crisis since the Great Depression shook the entire planet and everyone wondered why most people never saw it coming. Well, now a similar pattern is unfolding right before our eyes. The Dow and the S&P 500 both hit record highs on Monday, margin debt on Wall Street is hovering near record levels, the unemployment rate has ticked down a little bit and Americans are getting ready to spend more than 600 billion dollars this Christmas season. The truth is that the economy seems pretty stable for the moment, and most people cannot even imagine that an economic collapse is coming. So why are so many really smart people forecasting economic disaster in the near future?
For example, just consider what the Jerome Levy Forecasting Center is saying. This is an organization with a tremendous economic forecasting record that goes all the way back to the Great Depression. In fact, it predicted ahead of time the financial trouble and the recession that would happen in 2008. Well, now this company is forecasting that there is a 65 percent chance that there will be a global recession by the end of next year…
In 1929, a businessman and economist by the name of Jerome Levy didn’t like what he saw in his analysis of corporate profits. He sold his stocks before the October crash.
Almost eight decades later, the consultancy company that bears his name declared “the next recession will be caused by the deflating housing bubble.” By February 2007, it predicted problems in the subprime-mortgage market would spread “to virtually all financial markets.” In October 2007, it saw imminent recession — the slump began two months later.
The Jerome Levy Forecasting Center, based in Mount Kisco, New York, and run by Jerome’s grandson David, is again more worried than its peers. Its half-dozen analysts attach a 65 percent probability of a worldwide recession forcing a contraction in the U.S. by the end of next year.
Could they be wrong?
It’s certainly possible.
But I wouldn’t bet against them.
John Hussman is another expert that is warning of financial disaster on the horizon. He believes that we are experiencing a massive stock market bubble right now and that stocks are approximately double the value that they should be…
If you look at corporate profits and especially corporate profit margins, they’re one of the most cyclical and mean-reverting series in economics. Right now, we have corporate profits that are close to about 11% of GDP, but if you look at that series you will find that corporate profits as a share of GDP have always dropped back to about 5.5% or below in every single economic cycle including recent decades, including not only the financial crisis but 2002 and every other economic cycle we have been in.
Right now stocks as a multiple of last year’s expected earnings may look only modestly over valued or modestly richly valued. Really if you look at the measures of valuation that are most correlated to the returns that stocks deliver over time say over seven years or over the next 10 years the S&P 500 in our estimation is about double the level of valuation that would give investors a normal rate of return.
Could you imagine the chaos that would ensue if stocks really did drop by 50 percent?
Well, Hussman says that this is precisely what must happen in order for stock prices to return to historical norms…
Right now, like I say, we are looking at stocks that have been pressed to long-term expected returns that are really dismal. But more important than that, in every market cycle that we’ve seen with the mild exception of 2002, we’ve seen stocks price revert back to normal rates of return. In order to get to that point from here, we would have to have equities dropby about half.
If that does happen, it will make the crisis of 2008 look like a Sunday picnic.
Meanwhile, other very prominent thinkers are also warning that an economic nightmare is rapidly approaching.
Economic cycle theorist Martin Armstrong foresees major economic problems in 2015 which will ultimately lead to “civil unrest” in 2016…
It looks more and more like a serious political uprising will erupt by 2016 once the economy turns down. That is the magic ingredient. Turn the economy down and you get civil unrest and revolution.
And of course there are a whole lot of other economic cycle theorists that are forecasting that we are about to experience a massive economic downturn as well. For much more on this, please see this article andthis article.
What is truly frightening is that we have never even come close to recovering from the last economic crisis. One poll that was taken just prior to the recent election found that only 28 percent of Americans said that their families were doing better financially. In addition, here are some more survey numbers about how Americans are feeling about the economy…
According to voter exit polls conducted by CNN, 78% said they are worried about the economy, with 69% saying that, in their view, economic conditions are not good. 65% responded that the country is on the wrong track vs. only 31% who believed that it is headed in the right direction.
Even though we are repeating so many of the same patterns that we experienced back in 2007, we are doing so with a fundamentally weaker economy. The last crisis did a tremendous amount of permanent damage to us. For an extensive look at this, please see my previous article entitled “12 Charts That Show The Permanent Damage That Has Been Done To The U.S. Economy“.
And there are lots of signs that much of the planet is already entering another major economic slowdown. In a recent article, Brandon Smith summarized some of these. He says that we are currently witnessing “the last gasp of the global economy“…
Global exports, and thus consumer demand, are plunging. Germany, the only pillar left to prop up the failing European Union, has experienced a severe decline in exports not seen since 2009.
China, the largest exporter and importer in the world, and Chinese companies, have been caught in a number of instances using fraudulent invoices to artificially inflate their own export numbers, in some cases reporting 50% more exported goods than had actually existed.
China’s manufacturing has also declined for the past five months, exposing the nature of its inflated export stats and indicating a global slowdown.
The Baltic Dry Index, a measure of global shipping rates for raw goods, and thus a measure of demand for shipping, continues to drag along near historic lows.
The U.S. consumer (the only economic asset the U.S. has besides the dollar’s world reserve status), has seen declines in spending as well as wages.
In the meantime, long term jobless Americans continue to fall off welfare rolls by the millions, making unemployment numbers look good, but the overall future picture look terrible as participation rates dissolve into the ether of government statistics.
How is such poverty being hidden? Foodstamps. Plain and simple. Nearly 50 million Americans now subsist on food stamp programs today, and this number shows no signs of dropping. In states like Illinois, two people sign up for food assistance for every citizen that happens to find a job.
From time to time, I get accused of “spreading fear” and of being obsessed with “doom and gloom”.
But that is not the case at all.
I actually want our economy to stay stable for as long as possible. Many Americans don’t realize this, but even the poorest of us live in luxury compared to much of the rest of the world. It would be wonderful if we could all live out our lives in peace and quiet and safety.
Unfortunately, it is simply not going to happen.
And it does not take an expert to see what is coming.
Anyone with half a brain should be able to see the economic disaster that is approaching.
There is hope in understanding what is happening and there is hope in getting prepared. Millions of Americans that are willingly blind to our problems are going to have their lives absolutely destroyed when they get blindsided by the coming crisis. So please use this brief period of relative stability to get prepared and to warn others.
Once this false bubble of hope runs out, all of our lives are going to dramatically change.
Monday, October 27, 2014
SC124-9
http://www.informationclearinghouse.info/article40067.htm
Washington Is Defaming Putin
Vladimir Putin Is The Leader Of the Moral World
Here is a translation of Putin’s address at Valdai: http://eng.kremlin.ru/news/23137 - Ed note - Full video of President Putin speech - with English translation - http://www.informationclearinghouse.info/article40060.htm
Today at the Valdai International Discussion Club meeting in Sochi, Russia’s President Putin correctly and justifiably denounced Washington for destabilizing the world in order to serve its own narrow and selfish interest and the interests of the private interest groups that control Washington at the expense of the rest of the world. It is about time a world leader denounced the thuggish neocon regime in Washington. Putin described Washington’s double standards with the Roman phrase: “What is allowed for God [the US] is not allowed for cattle [the rest of the world].”
RT reports on Putin’s address here: http://rt.com/news/198924-putin-valdai-speech-president/
RIA Novotsi reports here: http://en.ria.ru/politics/20141024/194537272/Putin-Global-Security-System-Seriously-Weakened-Deformed.html
Curiously, the Russian media has not, at this time of writing, produced an English translation of Putin’s full remarks. Perhaps the Russian media do not realize the importance of Putin’s words. Too much of the Russian media is owned by foreign interests who use the access to Russian readers to attack and discredit the Russian government. It is amazing that the Russian government allows Washington’s propaganda within its own ranks. Perhaps Moscow accepts Washington’s propaganda among Russians in order to protect the broadcasts in the US of RT, RIA, and Voice of Russia. But the balance is uneven. The Russian broadcasts in the West report otherwise unreported news; they do not defame America.
See also:
Putin: world leaders blackmailed:
http://en.ria.ru/world/20141024/194542305/Putin-Says-Reports-Show-World-Leaders-Could-Be-Blackmailed-With.html
Putin: US escalates worldwide conflict: http://rt.com/news/198924-putin-valdai-speech-president/
German MP: sanctions without proof: http://en.ria.ru/interview/20141014/194062719/German-MP-Germany-Has-No-Evidence-of-Who-Shot-Down-MH17.html
I did not see any reporting of Putin’s address in the US print and TV media. Clearly in the US there is an absence of public discussion of US foreign policy and foreign reaction to it. A country in which propaganda and silence rule out awareness and public discussion is not a democracy regardless of what it calls itself.
Washington long ago learned the dark art of silencing truth with defamation. Washington used defamation to overthrow Iran’s elected leader, Mossadegh in 1953, to overthrow Congo’s prime minister Patrice Lumumba in 1960, to overthrow Guatemala’s President Arbenz in 1954, to overthrow Venezuela’s President Hugo Chevez in 2002, a coup that was cancelled by the Venezuelan people and military who threw out Washington’s stooge replacement and reinstalled Chavez, to overthrow Ukraine’s elected President Yanukovych in 2013, to overthrow Honduras President Manuel Zelaya in 2009 , to overthrow in 2013 Mohamed Morsi, president of the first democratically elected government in Egypt’s history, to overthrow Gaddafi in Libya, Saddam Hussein in Iraq, in ongoing efforts to overthrow Assad in Syria and the government of Iran, and in failed attempts to overthrow Indonesia’s Sukarno, Ho Chi Minh in Vietnam, and Castro in Cuba.
Today Washington’s target is Vladimir Putin. This is the height of folly and hubris. Putin’s public support far exceeds that of any American president in history. Currently, the level of public support for the Obama regime and the US Congress is far too low to be compatible with a functioning democracy. If the US is actually a democracy, it is the most dysfunctional democracy in world history. Practically no one, except the powerful private interest groups who own Washington, supports the US government. Everyone else despises Washington.
As the result of 13 years of murderous destruction of life and property in the Middle East and Africa, a dysfunctional and collapsing US economy, and a display of unrivaled arrogance, Washington has destroyed America’s soft power. Abroad only the deluded few and those paid by US-financed NGOs still have a good opinion of the United States.
In all world polls, the US ranks as the greatest threat to world peace. Washington has made our country a despised nation, and we the people have done nothing about it.
You would never know this from the US print or TV media or even from most of the UK and Western European media. As I reported on October 16, Udo Ulfkotte, a former editor of one of Germany’s most important newspapers, the Frankfurter Allgemeine Zeitung, has written a best-selling book in which he reports that the CIA owns everyone of significance in the major European media. In his own words Udo Ulfkotte says that he was “taught to lie, to betray and not to tell the truth to the public.” http://www.paulcraigroberts.org/2014/10/16/cia-owns-everyone-significance-major-media/
As a former Wall Street Journal editor, Business Week columnist, columnist for the Scripps Howard News Service, columnist for a German magazine and French and Italian newspapers, I observed and experienced the gradual impoundment of any dissent from Washington’s line. It became clear that the path to journalism success in the West was to lie for the Establishment in Washington, largely a private establishment along with the dark off-budget “security” agencies bolstered by the neoconservative ideology of US world hegemony.
Much of Russian media and Putin’s advisors are fully aware of Washington’s media campaign to defame President Vladimir Putin. http://en.itar-tass.com/russia/756160 The internet site Russia Insider today asked the pertinent question: “Is the CIA Running a Defamation Campaign Against Putin?” As Russia Insider makes clear, the answer is most certainly. http://russia-insider.com/en/politics_media_watch/2014/10/24/04-54-03pm/cia_running_defamation_campaign_against_putin
Click the URL above and view the front pages of the UK Sun, Daily Mirror, and Daily Express. I would bet that these are front pages designed in Washington or Langley and are in fact paid ads by the CIA or National Endowment for Democracy or by one of the Republican or Democrat organizations that sponsor Washington’s overseas propaganda.
Of course, these UK rags can be dismissed as sensational junk comparable to the US versions that are for sale at grocery store checkout counters–”movie star abducted by aliens in UFO.” So scroll down the page of the above URL and look at the covers of Newsweek and The Economist. Once these were respected publications. Today I would bet that no one reads them and that they are dependent on CIA subsidies for their existance. Nevertheless, they impact the European, Canadian, Australian, and Japanese media and no doubt the media of other countries on the borders of the US empire. A number of gullible fools still think that America has a free press.
Be sure to notice this section of the report from Russia Insider:
“The issue of manipulation of news by intelligence services has been in the news recently with revelations that the CIA and German Secret Service (GSS) have long-running programs to influence how media executives and top journalists convey and interpret the news, including direct cash payments.
“Here are some examples they point to:
Portraying him [Putin] as a scheming dictator trying to rebuild a repressive empire.
Claiming he personally ordered the murder of a number of journalists, and personally ordered a KGB defector to be murdered with radiation poisoning.
Frequently citing unsubstantiated rumors he is having an affair with a famous gymnast.
Allegations that he has stashed away billions for his personal benefit, without providing evidence.
Recent article in newsweek claiming he leads a luxurious and lazy lifestyle, sleeping late.
Recent article in NYT focusing on a supposed personal arrogance.
Hillary Clinton mentioning in speech after speech that he is a bad guy, a bully, that one must confront him forcefully.
Frequently using pejoratives to describe his person – “a jerk and a thug” (Thomas Friedman this week in the NYT)
Mis-quoting him on his regret about the collapse of the Soviet Union.
Articles about a supposed super-luxury villa built for him in southern Russia.
The over-the top headlines in the western media (they were worst of all in Germany) portraying him personally responsible for murdering the victims of MH17.
And soft stuff – magazine covers making him look sinister, monstrous, etc.”
If you are not already aware, I am pleased to introduce you to The Saker, a pseudonym for a high level US military analyst who lives in Florida. No, it is not me. Be sure to read the interview with Saker, which is at the bottom of the article: http://russia-insider.com/en/politics_media_watch/2014/10/24/04-54-03pm/cia_running_defamation_campaign_against_putin
Every day readers ask me what they as individuals can do. Some possibly are government trolls who hope I will answer “overthrow the government” so that I can be arrested as a terrorist. My answer to the question is that people are powerless until enough of them are informed. If people become informed and will take a stand, then the people can force the government back under their control. If this does not or cannot happen, democracy in America is dead, and our life as a free people protected by the Constitution and law against the power of the state is finished.
Possibly America is already finished and will now finish the rest of the world in its insane neoconservative drive to establish Washington’s hegemony over the entire world. Russia and China are not going to submit to being Washington’s vassals and India had enough of being a colony under Great Britain. If the crazed hegemons in Washington persist, nuclear war will be the outcome.
Washington Is Defaming Putin
Vladimir Putin Is The Leader Of the Moral World
Here is a translation of Putin’s address at Valdai: http://eng.kremlin.ru/news/23137 - Ed note - Full video of President Putin speech - with English translation - http://www.informationclearinghouse.info/article40060.htm
Today at the Valdai International Discussion Club meeting in Sochi, Russia’s President Putin correctly and justifiably denounced Washington for destabilizing the world in order to serve its own narrow and selfish interest and the interests of the private interest groups that control Washington at the expense of the rest of the world. It is about time a world leader denounced the thuggish neocon regime in Washington. Putin described Washington’s double standards with the Roman phrase: “What is allowed for God [the US] is not allowed for cattle [the rest of the world].”
RT reports on Putin’s address here: http://rt.com/news/198924-putin-valdai-speech-president/
RIA Novotsi reports here: http://en.ria.ru/politics/20141024/194537272/Putin-Global-Security-System-Seriously-Weakened-Deformed.html
Curiously, the Russian media has not, at this time of writing, produced an English translation of Putin’s full remarks. Perhaps the Russian media do not realize the importance of Putin’s words. Too much of the Russian media is owned by foreign interests who use the access to Russian readers to attack and discredit the Russian government. It is amazing that the Russian government allows Washington’s propaganda within its own ranks. Perhaps Moscow accepts Washington’s propaganda among Russians in order to protect the broadcasts in the US of RT, RIA, and Voice of Russia. But the balance is uneven. The Russian broadcasts in the West report otherwise unreported news; they do not defame America.
See also:
Putin: world leaders blackmailed:
http://en.ria.ru/world/20141024/194542305/Putin-Says-Reports-Show-World-Leaders-Could-Be-Blackmailed-With.html
Putin: US escalates worldwide conflict: http://rt.com/news/198924-putin-valdai-speech-president/
German MP: sanctions without proof: http://en.ria.ru/interview/20141014/194062719/German-MP-Germany-Has-No-Evidence-of-Who-Shot-Down-MH17.html
I did not see any reporting of Putin’s address in the US print and TV media. Clearly in the US there is an absence of public discussion of US foreign policy and foreign reaction to it. A country in which propaganda and silence rule out awareness and public discussion is not a democracy regardless of what it calls itself.
Washington long ago learned the dark art of silencing truth with defamation. Washington used defamation to overthrow Iran’s elected leader, Mossadegh in 1953, to overthrow Congo’s prime minister Patrice Lumumba in 1960, to overthrow Guatemala’s President Arbenz in 1954, to overthrow Venezuela’s President Hugo Chevez in 2002, a coup that was cancelled by the Venezuelan people and military who threw out Washington’s stooge replacement and reinstalled Chavez, to overthrow Ukraine’s elected President Yanukovych in 2013, to overthrow Honduras President Manuel Zelaya in 2009 , to overthrow in 2013 Mohamed Morsi, president of the first democratically elected government in Egypt’s history, to overthrow Gaddafi in Libya, Saddam Hussein in Iraq, in ongoing efforts to overthrow Assad in Syria and the government of Iran, and in failed attempts to overthrow Indonesia’s Sukarno, Ho Chi Minh in Vietnam, and Castro in Cuba.
Today Washington’s target is Vladimir Putin. This is the height of folly and hubris. Putin’s public support far exceeds that of any American president in history. Currently, the level of public support for the Obama regime and the US Congress is far too low to be compatible with a functioning democracy. If the US is actually a democracy, it is the most dysfunctional democracy in world history. Practically no one, except the powerful private interest groups who own Washington, supports the US government. Everyone else despises Washington.
As the result of 13 years of murderous destruction of life and property in the Middle East and Africa, a dysfunctional and collapsing US economy, and a display of unrivaled arrogance, Washington has destroyed America’s soft power. Abroad only the deluded few and those paid by US-financed NGOs still have a good opinion of the United States.
In all world polls, the US ranks as the greatest threat to world peace. Washington has made our country a despised nation, and we the people have done nothing about it.
You would never know this from the US print or TV media or even from most of the UK and Western European media. As I reported on October 16, Udo Ulfkotte, a former editor of one of Germany’s most important newspapers, the Frankfurter Allgemeine Zeitung, has written a best-selling book in which he reports that the CIA owns everyone of significance in the major European media. In his own words Udo Ulfkotte says that he was “taught to lie, to betray and not to tell the truth to the public.” http://www.paulcraigroberts.org/2014/10/16/cia-owns-everyone-significance-major-media/
As a former Wall Street Journal editor, Business Week columnist, columnist for the Scripps Howard News Service, columnist for a German magazine and French and Italian newspapers, I observed and experienced the gradual impoundment of any dissent from Washington’s line. It became clear that the path to journalism success in the West was to lie for the Establishment in Washington, largely a private establishment along with the dark off-budget “security” agencies bolstered by the neoconservative ideology of US world hegemony.
Much of Russian media and Putin’s advisors are fully aware of Washington’s media campaign to defame President Vladimir Putin. http://en.itar-tass.com/russia/756160 The internet site Russia Insider today asked the pertinent question: “Is the CIA Running a Defamation Campaign Against Putin?” As Russia Insider makes clear, the answer is most certainly. http://russia-insider.com/en/politics_media_watch/2014/10/24/04-54-03pm/cia_running_defamation_campaign_against_putin
Click the URL above and view the front pages of the UK Sun, Daily Mirror, and Daily Express. I would bet that these are front pages designed in Washington or Langley and are in fact paid ads by the CIA or National Endowment for Democracy or by one of the Republican or Democrat organizations that sponsor Washington’s overseas propaganda.
Of course, these UK rags can be dismissed as sensational junk comparable to the US versions that are for sale at grocery store checkout counters–”movie star abducted by aliens in UFO.” So scroll down the page of the above URL and look at the covers of Newsweek and The Economist. Once these were respected publications. Today I would bet that no one reads them and that they are dependent on CIA subsidies for their existance. Nevertheless, they impact the European, Canadian, Australian, and Japanese media and no doubt the media of other countries on the borders of the US empire. A number of gullible fools still think that America has a free press.
Be sure to notice this section of the report from Russia Insider:
“The issue of manipulation of news by intelligence services has been in the news recently with revelations that the CIA and German Secret Service (GSS) have long-running programs to influence how media executives and top journalists convey and interpret the news, including direct cash payments.
“Here are some examples they point to:
Portraying him [Putin] as a scheming dictator trying to rebuild a repressive empire.
Claiming he personally ordered the murder of a number of journalists, and personally ordered a KGB defector to be murdered with radiation poisoning.
Frequently citing unsubstantiated rumors he is having an affair with a famous gymnast.
Allegations that he has stashed away billions for his personal benefit, without providing evidence.
Recent article in newsweek claiming he leads a luxurious and lazy lifestyle, sleeping late.
Recent article in NYT focusing on a supposed personal arrogance.
Hillary Clinton mentioning in speech after speech that he is a bad guy, a bully, that one must confront him forcefully.
Frequently using pejoratives to describe his person – “a jerk and a thug” (Thomas Friedman this week in the NYT)
Mis-quoting him on his regret about the collapse of the Soviet Union.
Articles about a supposed super-luxury villa built for him in southern Russia.
The over-the top headlines in the western media (they were worst of all in Germany) portraying him personally responsible for murdering the victims of MH17.
And soft stuff – magazine covers making him look sinister, monstrous, etc.”
If you are not already aware, I am pleased to introduce you to The Saker, a pseudonym for a high level US military analyst who lives in Florida. No, it is not me. Be sure to read the interview with Saker, which is at the bottom of the article: http://russia-insider.com/en/politics_media_watch/2014/10/24/04-54-03pm/cia_running_defamation_campaign_against_putin
Every day readers ask me what they as individuals can do. Some possibly are government trolls who hope I will answer “overthrow the government” so that I can be arrested as a terrorist. My answer to the question is that people are powerless until enough of them are informed. If people become informed and will take a stand, then the people can force the government back under their control. If this does not or cannot happen, democracy in America is dead, and our life as a free people protected by the Constitution and law against the power of the state is finished.
Possibly America is already finished and will now finish the rest of the world in its insane neoconservative drive to establish Washington’s hegemony over the entire world. Russia and China are not going to submit to being Washington’s vassals and India had enough of being a colony under Great Britain. If the crazed hegemons in Washington persist, nuclear war will be the outcome.
SC124-8
http://www.truthdig.com/report/item/the_myth_of_the_free_press_20141026
The Myth of the Free Press
There is more truth about American journalism in the film “Kill the Messenger,” which chronicles the mainstream media’s discrediting of the work of the investigative journalist Gary Webb, than there is in the movie “All the President’s Men,” which celebrates the exploits of the reporters who uncovered the Watergate scandal.
The mass media blindly support the ideology of corporate capitalism. They laud and promote the myth of American democracy—even as we are stripped of civil liberties and money replaces the vote. They pay deference to the leaders on Wall Street and in Washington, no matter how perfidious their crimes. They slavishly venerate the military and law enforcement in the name of patriotism. They select the specialists and experts, almost always drawn from the centers of power, to interpret reality and explain policy. They usually rely on press releases, written by corporations, for their news. And they fill most of their news holes with celebrity gossip, lifestyle stories, sports and trivia. The role of the mass media is to entertain or to parrot official propaganda to the masses. The corporations, which own the press, hire journalists willing to be courtiers to the elites, and they promote them as celebrities. These journalistic courtiers, who can earn millions of dollars, are invited into the inner circles of power. They are, as John Ralston Saul writes, hedonists of power.
When Webb, writing in a 1996 series in the San Jose Mercury News, exposed the Central Intelligence Agency’s complicity in smuggling tons of cocaine for sale into the United States to fund the CIA-backed Contra rebels in Nicaragua, the press turned him into a journalistic leper. And over the generations there is a long list of journalistic lepers, from Ida B. Wells to I.F. Stone to Julian Assange.
The attacks against Webb have been renewed in publications such as The Washington Post since the release of the film earlier this month. These attacks are an act of self-justification. They are an attempt by the mass media to mask the collaboration between themselves and the power elite. The mass media, like the rest of the liberal establishment, seek to wrap themselves in the moral veneer of the fearless pursuit of truth and justice. But to maintain this myth they have to destroy the credibility of journalists such as Webb and Assange who shine a light on the sinister and murderous inner workings of empire, who care more about truth than news.
The country’s major news outlets—including my old employer The New York Times, which wrote that there was “scant proof” of Webb’s contention—functioned as guard dogs for the CIA. Soon after the 1996 exposé appeared, The Washington Post devoted nearly two full pages to attacking Webb’s assertions. The Los Angeles Times ran three separate articles that slammed Webb and his story. It was a seedy, disgusting and shameful chapter in American journalism. But it was hardly unique. Alexander Cockburn and Jeffrey St. Clair, in the 2004 article “How the Press and the CIA Killed Gary Webb’s Career,” detailed the dynamics of the nationwide smear campaign.
Webb’s newspaper, after printing a mea culpa about the series, cast him out. He was unable to work again as an investigative journalist and, fearful of losing his house, he committed suicide in 2004. We know, in part because of a Senate investigation led by then-Sen. John Kerry, that Webb was right. But truth was never the issue for those who opposed the journalist. Webb exposed the CIA as a bunch of gunrunning, drug-smuggling thugs. He exposed the mass media, which depend on official sources for most of their news and are therefore hostage to those sources, as craven handmaidens of power. He had crossed the line. And he paid for it.
If the CIA was funneling hundreds of millions of dollars in drugs into inner-city neighborhoods to fund an illegal war in Nicaragua, what did that say about the legitimacy of the vast covert organization? What did it tell us about the so-called war on drugs? What did it tell us about the government’s callousness and indifference to the poor, especially poor people of color at the height of the crack epidemic? What did it say about rogue military operations carried out beyond public scrutiny?
These were questions the power elites, and their courtiers in the press, were determined to silence.
The mass media are plagued by the same mediocrity, corporatism and careerism as the academy, labor unions, the arts, the Democratic Party and religious institutions. They cling to the self-serving mantra of impartiality and objectivity to justify their subservience to power. The press writes and speaks—unlike academics that chatter among themselves in arcane jargon like medieval theologians—to be heard and understood by the public. And for this reason the press is more powerful and more closely controlled by the state. It plays an essential role in the dissemination of official propaganda. But to effectively disseminate state propaganda the press must maintain the fiction of independence and integrity. It must hide its true intentions.
The mass media, as C. Wright Mills pointed out, are essential tools for conformity. They impart to readers and viewers their sense of themselves. They tell them who they are. They tell them what their aspirations should be. They promise to help them achieve these aspirations. They offer a variety of techniques, advice and schemes that promise personal and professional success. The mass media, as Wright wrote, exist primarily to help citizens feel they are successful and that they have met their aspirations even if they have not. They use language and images to manipulate and form opinions, not to foster genuine democratic debate and conversation or to open up public space for free political action and public deliberation. We are transformed into passive spectators of power by the mass media, which decide for us what is true and what is untrue, what is legitimate and what is not. Truth is not something we discover. It is decreed by the organs of mass communication.
“The divorce of truth from discourse and action—the instrumentalization of communication—has not merely increased the incidence of propaganda; it has disrupted the very notion of truth, and therefore the sense by which we take our bearings in the world is destroyed,” James W. Carey wrote in “Communication as Culture.”
Bridging the vast gap between the idealized identities—ones that in a commodity culture revolve around the acquisition of status, money, fame and power, or at least the illusion of it—and actual identities is the primary function of the mass media. And catering to these idealized identities, largely implanted by advertisers and the corporate culture, can be very profitable. We are given not what we need but what we want. The mass media allow us to escape into the enticing world of entertainment and spectacle. News is filtered into the mix, but it is not the primary concern of the mass media. No more than 15 percent of the space in any newspaper is devoted to news; the rest is devoted to a futile quest for self-actualization. The ratio is even more lopsided on the airwaves.
“This,” Mills wrote, “is probably the basic psychological formula of the mass media today. But, as a formula, it is not attuned to the development of the human being. It is a formula of a pseudo-world which the media invent and sustain.”
At the core of this pseudo-world is the myth that our national institutions, including those of government, the military and finance, are efficient and virtuous, that we can trust them and that their intentions are good. These institutions can be criticized for excesses and abuses, but they cannot be assailed as being hostile to democracy and the common good. They cannot be exposed as criminal enterprises, at least if one hopes to retain a voice in the mass media.
Those who work in the mass media, as I did for two decades, are acutely aware of the collaboration with power and the cynical manipulation of the public by the power elites. It does not mean there is never good journalism and that the subservience to corporate power within the academy always precludes good scholarship, but the internal pressures, hidden from public view, make great journalism and great scholarship very, very difficult. Such work, especially if it is sustained, is usually a career killer. Scholars like Norman Finkelstein and journalists like Webb and Assange who step outside the acceptable parameters of debate and challenge the mythic narrative of power, who question the motives and virtues of established institutions and who name the crimes of empire are always cast out.
The press will attack groups within the power elite only when one faction within the circle of power goes to war with another. When Richard Nixon, who had used illegal and clandestine methods to harass and shut down the underground press as well as persecute anti-war activists and radical black dissidents, went after the Democratic Party he became fair game for the press. His sin was not the abuse of power. He had abused power for a long time against people and groups that did not matter in the eyes of the Establishment. Nixon’s sin was to abuse power against a faction within the power elite itself.
The Watergate scandal, mythologized as evidence of a fearless and independent press, is illustrative of how circumscribed the mass media is when it comes to investigating centers of power.
“History has been kind enough to contrive for us a ‘controlled experiment’ to determine just what was at stake during the Watergate period, when the confrontational stance of the media reached its peak. The answer is clear and precise: powerful groups are capable of defending themselves, not surprisingly; and by media standards, it is a scandal when their position and rights are threatened,” Edward S. Herman and Noam Chomsky wrote in “Manufacturing Consent: The Political Economy of the Mass Media.” “By contrast, as long as illegalities and violations of democratic substance are confined to marginal groups or dissident victims of U.S. military attack, or result in a diffused cost imposed on the general population, media opposition is muted and absent altogether. This is why Nixon could go so far, lulled into a false sense of security precisely because the watchdog only barked when he began to threaten the privileged.”
The righteous thunder of the abolitionists and civil rights preachers, the investigative journalists who enraged Standard Oil and the owners of the Chicago stockyards, the radical theater productions, such as “The Cradle Will Rock,” that imploded the myths peddled by the ruling class and gave a voice to ordinary people, the labor unions that permitted African-Americans, immigrants and working men and women to find dignity and hope, the great public universities that offered the children of immigrants a chance for a first-class education, the New Deal Democrats who understood that a democracy is not safe if it does not give its citizens an acceptable standard of living and protect the state from being hijacked by private power, are no longer part of the American landscape. It was Webb’s misfortune to work in an era when the freedom of the press was as empty a cliché as democracy itself.
“The Cradle Will Rock,” like much of the popular work that came out of the Federal Theatre Project, addressed the concerns of the working class rather than the power elite. And it excoriated the folly of war, greed, corruption and the complicity of liberal institutions, especially the press, in protecting the power elite and ignoring the abuses of capitalism. Mister Mister in the play runs the town like a private corporation.
“I believe newspapers are great mental shapers,” Mister Mister says. “My steel industry is dependent on them really.”
“Just you call the News,” Editor Daily responds. “And we’ll print all the news. From coast to coast, and from border to border.”
Editor Daily and Mister Mister sing:
O the press, the press, the freedom of the press.
They’ll never take away the freedom of the press.
We must be free to say whatever’s on our chest—
with a hey-diddle-dee and ho-nanny-no
for whichever side will pay the best.
“I should like a series on young Larry Foreman,” Mister Mister tells Editor Daily. “Who goes around stormin’ and organizin’ unions.”
“Yes, we’ve heard of him,” Editor Daily tells Mister Mister. “In fact, good word of him. He seems quite popular with workingmen.”
“Find out who he drinks with and talks with and sleeps with. And look up his past till at last you’ve got it on him.”
“But the man is so full of fight, he’s simply dynamite, why it would take an army to tame him,” Editor Daily says.
“Then it shouldn’t be too hard to tame him,” Mister Mister says.
“O the press, the press, the freedom of the press,” the two sing. “You’ve only got to hint whatever’s fit to print; if something’s wrong with it, why then we’ll print to fit. With a he-diddly-dee and aho-nonny-no. For whichever side will pay the best.”
The Myth of the Free Press
There is more truth about American journalism in the film “Kill the Messenger,” which chronicles the mainstream media’s discrediting of the work of the investigative journalist Gary Webb, than there is in the movie “All the President’s Men,” which celebrates the exploits of the reporters who uncovered the Watergate scandal.
The mass media blindly support the ideology of corporate capitalism. They laud and promote the myth of American democracy—even as we are stripped of civil liberties and money replaces the vote. They pay deference to the leaders on Wall Street and in Washington, no matter how perfidious their crimes. They slavishly venerate the military and law enforcement in the name of patriotism. They select the specialists and experts, almost always drawn from the centers of power, to interpret reality and explain policy. They usually rely on press releases, written by corporations, for their news. And they fill most of their news holes with celebrity gossip, lifestyle stories, sports and trivia. The role of the mass media is to entertain or to parrot official propaganda to the masses. The corporations, which own the press, hire journalists willing to be courtiers to the elites, and they promote them as celebrities. These journalistic courtiers, who can earn millions of dollars, are invited into the inner circles of power. They are, as John Ralston Saul writes, hedonists of power.
When Webb, writing in a 1996 series in the San Jose Mercury News, exposed the Central Intelligence Agency’s complicity in smuggling tons of cocaine for sale into the United States to fund the CIA-backed Contra rebels in Nicaragua, the press turned him into a journalistic leper. And over the generations there is a long list of journalistic lepers, from Ida B. Wells to I.F. Stone to Julian Assange.
The attacks against Webb have been renewed in publications such as The Washington Post since the release of the film earlier this month. These attacks are an act of self-justification. They are an attempt by the mass media to mask the collaboration between themselves and the power elite. The mass media, like the rest of the liberal establishment, seek to wrap themselves in the moral veneer of the fearless pursuit of truth and justice. But to maintain this myth they have to destroy the credibility of journalists such as Webb and Assange who shine a light on the sinister and murderous inner workings of empire, who care more about truth than news.
The country’s major news outlets—including my old employer The New York Times, which wrote that there was “scant proof” of Webb’s contention—functioned as guard dogs for the CIA. Soon after the 1996 exposé appeared, The Washington Post devoted nearly two full pages to attacking Webb’s assertions. The Los Angeles Times ran three separate articles that slammed Webb and his story. It was a seedy, disgusting and shameful chapter in American journalism. But it was hardly unique. Alexander Cockburn and Jeffrey St. Clair, in the 2004 article “How the Press and the CIA Killed Gary Webb’s Career,” detailed the dynamics of the nationwide smear campaign.
Webb’s newspaper, after printing a mea culpa about the series, cast him out. He was unable to work again as an investigative journalist and, fearful of losing his house, he committed suicide in 2004. We know, in part because of a Senate investigation led by then-Sen. John Kerry, that Webb was right. But truth was never the issue for those who opposed the journalist. Webb exposed the CIA as a bunch of gunrunning, drug-smuggling thugs. He exposed the mass media, which depend on official sources for most of their news and are therefore hostage to those sources, as craven handmaidens of power. He had crossed the line. And he paid for it.
If the CIA was funneling hundreds of millions of dollars in drugs into inner-city neighborhoods to fund an illegal war in Nicaragua, what did that say about the legitimacy of the vast covert organization? What did it tell us about the so-called war on drugs? What did it tell us about the government’s callousness and indifference to the poor, especially poor people of color at the height of the crack epidemic? What did it say about rogue military operations carried out beyond public scrutiny?
These were questions the power elites, and their courtiers in the press, were determined to silence.
The mass media are plagued by the same mediocrity, corporatism and careerism as the academy, labor unions, the arts, the Democratic Party and religious institutions. They cling to the self-serving mantra of impartiality and objectivity to justify their subservience to power. The press writes and speaks—unlike academics that chatter among themselves in arcane jargon like medieval theologians—to be heard and understood by the public. And for this reason the press is more powerful and more closely controlled by the state. It plays an essential role in the dissemination of official propaganda. But to effectively disseminate state propaganda the press must maintain the fiction of independence and integrity. It must hide its true intentions.
The mass media, as C. Wright Mills pointed out, are essential tools for conformity. They impart to readers and viewers their sense of themselves. They tell them who they are. They tell them what their aspirations should be. They promise to help them achieve these aspirations. They offer a variety of techniques, advice and schemes that promise personal and professional success. The mass media, as Wright wrote, exist primarily to help citizens feel they are successful and that they have met their aspirations even if they have not. They use language and images to manipulate and form opinions, not to foster genuine democratic debate and conversation or to open up public space for free political action and public deliberation. We are transformed into passive spectators of power by the mass media, which decide for us what is true and what is untrue, what is legitimate and what is not. Truth is not something we discover. It is decreed by the organs of mass communication.
“The divorce of truth from discourse and action—the instrumentalization of communication—has not merely increased the incidence of propaganda; it has disrupted the very notion of truth, and therefore the sense by which we take our bearings in the world is destroyed,” James W. Carey wrote in “Communication as Culture.”
Bridging the vast gap between the idealized identities—ones that in a commodity culture revolve around the acquisition of status, money, fame and power, or at least the illusion of it—and actual identities is the primary function of the mass media. And catering to these idealized identities, largely implanted by advertisers and the corporate culture, can be very profitable. We are given not what we need but what we want. The mass media allow us to escape into the enticing world of entertainment and spectacle. News is filtered into the mix, but it is not the primary concern of the mass media. No more than 15 percent of the space in any newspaper is devoted to news; the rest is devoted to a futile quest for self-actualization. The ratio is even more lopsided on the airwaves.
“This,” Mills wrote, “is probably the basic psychological formula of the mass media today. But, as a formula, it is not attuned to the development of the human being. It is a formula of a pseudo-world which the media invent and sustain.”
At the core of this pseudo-world is the myth that our national institutions, including those of government, the military and finance, are efficient and virtuous, that we can trust them and that their intentions are good. These institutions can be criticized for excesses and abuses, but they cannot be assailed as being hostile to democracy and the common good. They cannot be exposed as criminal enterprises, at least if one hopes to retain a voice in the mass media.
Those who work in the mass media, as I did for two decades, are acutely aware of the collaboration with power and the cynical manipulation of the public by the power elites. It does not mean there is never good journalism and that the subservience to corporate power within the academy always precludes good scholarship, but the internal pressures, hidden from public view, make great journalism and great scholarship very, very difficult. Such work, especially if it is sustained, is usually a career killer. Scholars like Norman Finkelstein and journalists like Webb and Assange who step outside the acceptable parameters of debate and challenge the mythic narrative of power, who question the motives and virtues of established institutions and who name the crimes of empire are always cast out.
The press will attack groups within the power elite only when one faction within the circle of power goes to war with another. When Richard Nixon, who had used illegal and clandestine methods to harass and shut down the underground press as well as persecute anti-war activists and radical black dissidents, went after the Democratic Party he became fair game for the press. His sin was not the abuse of power. He had abused power for a long time against people and groups that did not matter in the eyes of the Establishment. Nixon’s sin was to abuse power against a faction within the power elite itself.
The Watergate scandal, mythologized as evidence of a fearless and independent press, is illustrative of how circumscribed the mass media is when it comes to investigating centers of power.
“History has been kind enough to contrive for us a ‘controlled experiment’ to determine just what was at stake during the Watergate period, when the confrontational stance of the media reached its peak. The answer is clear and precise: powerful groups are capable of defending themselves, not surprisingly; and by media standards, it is a scandal when their position and rights are threatened,” Edward S. Herman and Noam Chomsky wrote in “Manufacturing Consent: The Political Economy of the Mass Media.” “By contrast, as long as illegalities and violations of democratic substance are confined to marginal groups or dissident victims of U.S. military attack, or result in a diffused cost imposed on the general population, media opposition is muted and absent altogether. This is why Nixon could go so far, lulled into a false sense of security precisely because the watchdog only barked when he began to threaten the privileged.”
The righteous thunder of the abolitionists and civil rights preachers, the investigative journalists who enraged Standard Oil and the owners of the Chicago stockyards, the radical theater productions, such as “The Cradle Will Rock,” that imploded the myths peddled by the ruling class and gave a voice to ordinary people, the labor unions that permitted African-Americans, immigrants and working men and women to find dignity and hope, the great public universities that offered the children of immigrants a chance for a first-class education, the New Deal Democrats who understood that a democracy is not safe if it does not give its citizens an acceptable standard of living and protect the state from being hijacked by private power, are no longer part of the American landscape. It was Webb’s misfortune to work in an era when the freedom of the press was as empty a cliché as democracy itself.
“The Cradle Will Rock,” like much of the popular work that came out of the Federal Theatre Project, addressed the concerns of the working class rather than the power elite. And it excoriated the folly of war, greed, corruption and the complicity of liberal institutions, especially the press, in protecting the power elite and ignoring the abuses of capitalism. Mister Mister in the play runs the town like a private corporation.
“I believe newspapers are great mental shapers,” Mister Mister says. “My steel industry is dependent on them really.”
“Just you call the News,” Editor Daily responds. “And we’ll print all the news. From coast to coast, and from border to border.”
Editor Daily and Mister Mister sing:
O the press, the press, the freedom of the press.
They’ll never take away the freedom of the press.
We must be free to say whatever’s on our chest—
with a hey-diddle-dee and ho-nanny-no
for whichever side will pay the best.
“I should like a series on young Larry Foreman,” Mister Mister tells Editor Daily. “Who goes around stormin’ and organizin’ unions.”
“Yes, we’ve heard of him,” Editor Daily tells Mister Mister. “In fact, good word of him. He seems quite popular with workingmen.”
“Find out who he drinks with and talks with and sleeps with. And look up his past till at last you’ve got it on him.”
“But the man is so full of fight, he’s simply dynamite, why it would take an army to tame him,” Editor Daily says.
“Then it shouldn’t be too hard to tame him,” Mister Mister says.
“O the press, the press, the freedom of the press,” the two sing. “You’ve only got to hint whatever’s fit to print; if something’s wrong with it, why then we’ll print to fit. With a he-diddly-dee and aho-nonny-no. For whichever side will pay the best.”
Sunday, October 26, 2014
SC124-7
http://www.resilience.org/stories/2014-10-22/the-next-financial-crisis-may-be-just-around-the-corner
The Next Financial Crisis May Be Just Around the Corner
As growth stalls, stocks tumble and investors fret, the question is no longer if there will be another crisis, but when and where it will strike first.
The headlines look eerily familiar: global growth is stalling, stocks are tumbling and peripheral bond yields are rising sharply. With the Federal Reserve expected to wind down its asset buyback scheme later this month and the Ebola outbreak and geopolitical instability spooking investors, world markets are returning to a highly volatile state. “The market pathologies we all grew to know during the crisis of 2008 are returning,” the Financial Times wrote last week. The question is no longer if there will be another crisis, but when and where it will strike first.
The bottom line is that the global financial meltdown of 2008-’09 and the European debt crisis of 2010-’12 have never truly been resolved. After governments disbursed record bailouts in the wake of the Wall Street crash, the world’s leading central banks simply papered over the remaining weaknesses by subsidizing essentially defunct financial institutions to the tune of trillions of dollars, buying up swaths of toxic assets and providing loans at negative real interest rates in the hope of reviving the credit system and saving the banks.
But instead of fixing the underlying problems of structural indebtedness, record unemployment, rampant inequality and a seemingly never-ending recession, these measures have only made matters worse. For one, they have fed an enormous credit bubble that dwarfs even the previous one, which nearly sank the world economy back in 2008. The latest Geneva report by the International Center for Monetary and Banking Studies notes that total world debt — excluding that of the financial sector — has shot up 38% since the collapse of Lehman Brothers, reaching new historic highs. Last year, global public and private debt stood at 212% of global output, up from 180% in 2008.
With this tidal wave of cheap credit sloshing through the world financial system, investors went looking for the highest yields. Since the US housing market and European bond markets were still reeling from the last crisis, they turned towards the stock exchange. Between mid-2013 and mid-2014, the average global return on equity rose to a whopping 18 percent. Yale economist Robert Shiller has shown that “the gap between stock prices and corporate earnings is now larger than it was in the previous pre-crisis periods,” and “if markets were to return to their normal earning levels, the average stock market in the world should fall by about 30 per cent.”
At the same time, trillions of dollars found their way into the housing markets of emerging economies. In Brazil, for instance, foreign investment in urban transformation projects for the World Cup and the Olympics led to a speculative housing bubble that saw residential property prices rise by more than 80% between 2007 and 2013. In Turkey, too, a massive influx of foreign credit fed a construction boom that has dramatically transformed the urban landscape, with skyscrapers, shopping malls and infrastructural mega-projects mushrooming across the Istanbul skyline. In both countries the resultant social displacements have led to sustained protest and social unrest.
The mother of all credit bubbles, however, has been quietly building up elsewhere, in China, where the government — in a desperate bid to ward off the spillover effects of the Great Recession — has pumped over $13 trillion worth of credit into the economy. This has in turn given rise to a monstrous $4.4 trillion shadow banking system and a housing bubble of truly epic proportions, leaving ghost towns sprawled across the country. It has also turned China into one of the most indebted developing countries in the world, with total public and private debt (excluding financial institutions) skyrocketing to 217% of GDP last year, up from from 147% of GDP in 2008.
The shadow banking system is not just a Chinese problem. In the United States and Europe, debt creation is also increasingly the product of off-balance sheet lending by non-bank financial institutions like hedge funds, insurance companies, private equity funds and broker dealers. The shadow banking system remains largely unregulated, allowing lenders to take much greater risks than ordinary banks could. For this reason, the IMF has warned that the world’s $70 trillion shadow banking system poses a major threat to global financial stability. In the US, shadow banking activities already amount to 2.5 times the size of conventional bank activity.
Meanwhile, troubling signs are emerging in Europe, where four years of austerity have trapped the world’s largest economy in a debilitating deflationary spiral. Even Germany, the EU’s economic powerhouse, is falling back into recession, while Greece returned to the eye of the storm after its stock market went into free fall last week. Greek bonds are now trading far above the 7% mark, which back in 2011 was widely considered to be “the point of no return.” Investors appear to be concerned over the health of Greek banks, the rising popularity of the anti-austerity party SYRIZA, and government plans to exit the bailout early in order to stem SYRIZA’s rise in the polls.
Add to this the growing geopolitical instability in Ukraine and the Middle East, and the conditions appear to be ripe for another round of market panic. Sooner or later, one of the bubbles is bound to pop — and the consequences will not be pretty. What is different this time around is that total debt levels are now even more unmanageable than they were back in 2008, while governments — having already used up most of their fiscal and monetary firepower over the past six years — are even less capable of mounting a proper response. We do not yet know when or where the next crisis will strike, but when it does it will be big...
A comment to this article:
" Making the point that we are heading for another financial crash is to state out the obvious, as if the whole thing revolves around finance, and in some way can be managed and/or manipulated if only we understand the financial shenanigans of economists/banks/governmenents and so on. The last crash (08) and the next one are just bounces before the final big one.
No mention of the real problem, that we constructed our ever-accelerating system of delusional prosperity on the promise of infinite availability of cheap coal oil and gas.
We can even date the start of that prosperity: 1776. That was the year the fist viable steam engine was patented. That enabled access to deep mines, and in 1859, the first deep oilwells. Coal and oil provided colossal returns on energy up to 100:1, and grew our cities and populations and the industrial system that fueled the concept of infinite growth driven by infinite debt, and in so doing made the final crash inevitable. Right now our infrastructure demands energy
returns of 100:1, while denying the reality that our energy returns are 17: 1
at best, and falling. Oil shale fields deliver much less. But our political
leaders continue to promise more, when there is no more to be had. Despite the hype, oil production cannot return to the 100:1 ratio, no matter how hard or deep we drill. Just as that date of the oilparty is known, we can date its end.
That will be when the return (EROEI) drops below about 12: 1, Then the final irreversible crash will hit and civilization as we know it will be over. "
The Next Financial Crisis May Be Just Around the Corner
As growth stalls, stocks tumble and investors fret, the question is no longer if there will be another crisis, but when and where it will strike first.
The headlines look eerily familiar: global growth is stalling, stocks are tumbling and peripheral bond yields are rising sharply. With the Federal Reserve expected to wind down its asset buyback scheme later this month and the Ebola outbreak and geopolitical instability spooking investors, world markets are returning to a highly volatile state. “The market pathologies we all grew to know during the crisis of 2008 are returning,” the Financial Times wrote last week. The question is no longer if there will be another crisis, but when and where it will strike first.
The bottom line is that the global financial meltdown of 2008-’09 and the European debt crisis of 2010-’12 have never truly been resolved. After governments disbursed record bailouts in the wake of the Wall Street crash, the world’s leading central banks simply papered over the remaining weaknesses by subsidizing essentially defunct financial institutions to the tune of trillions of dollars, buying up swaths of toxic assets and providing loans at negative real interest rates in the hope of reviving the credit system and saving the banks.
But instead of fixing the underlying problems of structural indebtedness, record unemployment, rampant inequality and a seemingly never-ending recession, these measures have only made matters worse. For one, they have fed an enormous credit bubble that dwarfs even the previous one, which nearly sank the world economy back in 2008. The latest Geneva report by the International Center for Monetary and Banking Studies notes that total world debt — excluding that of the financial sector — has shot up 38% since the collapse of Lehman Brothers, reaching new historic highs. Last year, global public and private debt stood at 212% of global output, up from 180% in 2008.
With this tidal wave of cheap credit sloshing through the world financial system, investors went looking for the highest yields. Since the US housing market and European bond markets were still reeling from the last crisis, they turned towards the stock exchange. Between mid-2013 and mid-2014, the average global return on equity rose to a whopping 18 percent. Yale economist Robert Shiller has shown that “the gap between stock prices and corporate earnings is now larger than it was in the previous pre-crisis periods,” and “if markets were to return to their normal earning levels, the average stock market in the world should fall by about 30 per cent.”
At the same time, trillions of dollars found their way into the housing markets of emerging economies. In Brazil, for instance, foreign investment in urban transformation projects for the World Cup and the Olympics led to a speculative housing bubble that saw residential property prices rise by more than 80% between 2007 and 2013. In Turkey, too, a massive influx of foreign credit fed a construction boom that has dramatically transformed the urban landscape, with skyscrapers, shopping malls and infrastructural mega-projects mushrooming across the Istanbul skyline. In both countries the resultant social displacements have led to sustained protest and social unrest.
The mother of all credit bubbles, however, has been quietly building up elsewhere, in China, where the government — in a desperate bid to ward off the spillover effects of the Great Recession — has pumped over $13 trillion worth of credit into the economy. This has in turn given rise to a monstrous $4.4 trillion shadow banking system and a housing bubble of truly epic proportions, leaving ghost towns sprawled across the country. It has also turned China into one of the most indebted developing countries in the world, with total public and private debt (excluding financial institutions) skyrocketing to 217% of GDP last year, up from from 147% of GDP in 2008.
The shadow banking system is not just a Chinese problem. In the United States and Europe, debt creation is also increasingly the product of off-balance sheet lending by non-bank financial institutions like hedge funds, insurance companies, private equity funds and broker dealers. The shadow banking system remains largely unregulated, allowing lenders to take much greater risks than ordinary banks could. For this reason, the IMF has warned that the world’s $70 trillion shadow banking system poses a major threat to global financial stability. In the US, shadow banking activities already amount to 2.5 times the size of conventional bank activity.
Meanwhile, troubling signs are emerging in Europe, where four years of austerity have trapped the world’s largest economy in a debilitating deflationary spiral. Even Germany, the EU’s economic powerhouse, is falling back into recession, while Greece returned to the eye of the storm after its stock market went into free fall last week. Greek bonds are now trading far above the 7% mark, which back in 2011 was widely considered to be “the point of no return.” Investors appear to be concerned over the health of Greek banks, the rising popularity of the anti-austerity party SYRIZA, and government plans to exit the bailout early in order to stem SYRIZA’s rise in the polls.
Add to this the growing geopolitical instability in Ukraine and the Middle East, and the conditions appear to be ripe for another round of market panic. Sooner or later, one of the bubbles is bound to pop — and the consequences will not be pretty. What is different this time around is that total debt levels are now even more unmanageable than they were back in 2008, while governments — having already used up most of their fiscal and monetary firepower over the past six years — are even less capable of mounting a proper response. We do not yet know when or where the next crisis will strike, but when it does it will be big...
A comment to this article:
" Making the point that we are heading for another financial crash is to state out the obvious, as if the whole thing revolves around finance, and in some way can be managed and/or manipulated if only we understand the financial shenanigans of economists/banks/governmenents and so on. The last crash (08) and the next one are just bounces before the final big one.
No mention of the real problem, that we constructed our ever-accelerating system of delusional prosperity on the promise of infinite availability of cheap coal oil and gas.
We can even date the start of that prosperity: 1776. That was the year the fist viable steam engine was patented. That enabled access to deep mines, and in 1859, the first deep oilwells. Coal and oil provided colossal returns on energy up to 100:1, and grew our cities and populations and the industrial system that fueled the concept of infinite growth driven by infinite debt, and in so doing made the final crash inevitable. Right now our infrastructure demands energy
returns of 100:1, while denying the reality that our energy returns are 17: 1
at best, and falling. Oil shale fields deliver much less. But our political
leaders continue to promise more, when there is no more to be had. Despite the hype, oil production cannot return to the 100:1 ratio, no matter how hard or deep we drill. Just as that date of the oilparty is known, we can date its end.
That will be when the return (EROEI) drops below about 12: 1, Then the final irreversible crash will hit and civilization as we know it will be over. "
SC124-6
http://kulturcritic.wordpress.com/posts/dread-and-the-terror-of-history/
Dread and The Terror of History
In the current twilight of apocalyptic global affairs, Kafkaesque geopolitical mayhem, and catastrophic climate-change, perhaps it is relevant to take a break from the competition, and reflect briefly on the terror of historical consciousness and the real dread of history through which we are living. Increasingly in this digital and digitized virtual world, we are not merely watching our appliances, the i-Pods, i-Pads, i-Phones, and Mac-Books that crowd out our real living spaces, but we are also spectators in the greater narrative of history being spun around us, almost automatically. Such a spectacle even informs our own autobiographies, as we allow its world historical agents and events to dictate our own worlds, emotionally and intellectually.
Historian of Religion, Mircea Eliade, reported back in 1959 that:
" History either makes itself (as the result of seed sown by acts that occurred in the past, several centuries or even millennia ago…) or it tends to be made by an increasingly smaller number of men [!] who not only prohibit the mass of their contemporaries from directly or indirectly intervening in the history they are making, but in addition have at their disposal means sufficient to force each individual to endure, for his own part, the consequences of this history, that is to live immediately and continuously in dread of history.” (Cosmos and History: The Myth of the Eternal Return, NY 1959)"
The insight here is both accurate and frightening (viz., dreadful). And yet the more connected we have become to one another, the more trapped we are becoming; spectators and not actors in this drama of history. But, that was the apparent triumph of historical consciousness; no longer tied to traditional archetypes and myths, but free to explore, make progress, and create history. No longer participants in the great cycles of nature, we were free to innovate, compete, acquire and control nature, rather than be controlled by it. But, therein lies the cruel joke, the rub. Cut loose from the methexis, “direct participation” in the cyclical drama, in the telluric energies of our Pleistocene makeup, and the natural world which infuses and enlightens us – we became rather victims to the vicissitudes of events orchestrated (poorly or masterfully) by great historical actors. We became slaves to a machine operating independently of our “wills,” now apparently freed from the stable moorings of myth, ritual and tribal participation. We became lost in a terrible labyrinth of cause and effect, of significations without a signified, of false flags and false hopes, of pin-up models rather than archetypes, unwitting victims of dissimulation and unforgiving distraction.
We have before us, my fellow spectators, one such player, Baruch Hussein Obama, President of the United States. He is the pen and the mouthpiece, a posterboy for historical actors par excellence. And we, the guileless spectators, are forced to endure the consequence of the fabled history he creates. Not that he alone is culpable, but there is an increasingly smaller and tighter cadre of those who enable and write this history we must endure like oxen in the field. You too work to pay your tribute to these historical actors who thus send off your slave wages to fight their wars and make their history in far off lands. They distribute your wealth (LOL) to the ministers of State who monitor and mediate, mollify and modulate what you know, who you know, and what you say. They watch you, and you pay for it.
No one in this drama of historical creativity is exempt from prosecution. From Israel to China, from Russia to Brazil, from Iran to India, from Germany to Belgium, all states are party to this unfolding cacophony. However, if we listen closely to that particular part of this rhythm being played out ever so loudly by Washington against Moscow, it is difficult for those of us in the West to forgive the constant drumbeat of death, together with the noise and the distractions being trumpeted in our name by Baruch Hussein Obama. The masked Greek chorus has not yet sung its closing lines heralding the end of this tragedy. But surely, it must be hiding, waiting just behind the curtain. When will the dread be lifted from our shoulders? When will the tragedy and the terror of historical consciousness finally be laid to rest? Perhaps, the crisis that has spread like a virus from Liberia to the land of Liberty will point the way. Both Bosch and Kafka would be proud.
Dread and The Terror of History
In the current twilight of apocalyptic global affairs, Kafkaesque geopolitical mayhem, and catastrophic climate-change, perhaps it is relevant to take a break from the competition, and reflect briefly on the terror of historical consciousness and the real dread of history through which we are living. Increasingly in this digital and digitized virtual world, we are not merely watching our appliances, the i-Pods, i-Pads, i-Phones, and Mac-Books that crowd out our real living spaces, but we are also spectators in the greater narrative of history being spun around us, almost automatically. Such a spectacle even informs our own autobiographies, as we allow its world historical agents and events to dictate our own worlds, emotionally and intellectually.
Historian of Religion, Mircea Eliade, reported back in 1959 that:
" History either makes itself (as the result of seed sown by acts that occurred in the past, several centuries or even millennia ago…) or it tends to be made by an increasingly smaller number of men [!] who not only prohibit the mass of their contemporaries from directly or indirectly intervening in the history they are making, but in addition have at their disposal means sufficient to force each individual to endure, for his own part, the consequences of this history, that is to live immediately and continuously in dread of history.” (Cosmos and History: The Myth of the Eternal Return, NY 1959)"
The insight here is both accurate and frightening (viz., dreadful). And yet the more connected we have become to one another, the more trapped we are becoming; spectators and not actors in this drama of history. But, that was the apparent triumph of historical consciousness; no longer tied to traditional archetypes and myths, but free to explore, make progress, and create history. No longer participants in the great cycles of nature, we were free to innovate, compete, acquire and control nature, rather than be controlled by it. But, therein lies the cruel joke, the rub. Cut loose from the methexis, “direct participation” in the cyclical drama, in the telluric energies of our Pleistocene makeup, and the natural world which infuses and enlightens us – we became rather victims to the vicissitudes of events orchestrated (poorly or masterfully) by great historical actors. We became slaves to a machine operating independently of our “wills,” now apparently freed from the stable moorings of myth, ritual and tribal participation. We became lost in a terrible labyrinth of cause and effect, of significations without a signified, of false flags and false hopes, of pin-up models rather than archetypes, unwitting victims of dissimulation and unforgiving distraction.
We have before us, my fellow spectators, one such player, Baruch Hussein Obama, President of the United States. He is the pen and the mouthpiece, a posterboy for historical actors par excellence. And we, the guileless spectators, are forced to endure the consequence of the fabled history he creates. Not that he alone is culpable, but there is an increasingly smaller and tighter cadre of those who enable and write this history we must endure like oxen in the field. You too work to pay your tribute to these historical actors who thus send off your slave wages to fight their wars and make their history in far off lands. They distribute your wealth (LOL) to the ministers of State who monitor and mediate, mollify and modulate what you know, who you know, and what you say. They watch you, and you pay for it.
No one in this drama of historical creativity is exempt from prosecution. From Israel to China, from Russia to Brazil, from Iran to India, from Germany to Belgium, all states are party to this unfolding cacophony. However, if we listen closely to that particular part of this rhythm being played out ever so loudly by Washington against Moscow, it is difficult for those of us in the West to forgive the constant drumbeat of death, together with the noise and the distractions being trumpeted in our name by Baruch Hussein Obama. The masked Greek chorus has not yet sung its closing lines heralding the end of this tragedy. But surely, it must be hiding, waiting just behind the curtain. When will the dread be lifted from our shoulders? When will the tragedy and the terror of historical consciousness finally be laid to rest? Perhaps, the crisis that has spread like a virus from Liberia to the land of Liberty will point the way. Both Bosch and Kafka would be proud.
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